Expatriation: The cross-cultural issues and design of training for coping 1

Amit Pande
Fellow Programme in Management
Personnel and Industrial Relations Area
IIM Ahmedabad
Vastrapur,Gujarat - 380015
E Mail - amitp@iimahd.ernet.in
Phone : 079 26327518

Sandeep K. Krishnan
Fellow Programme in Management
Personnel and Industrial Relations Area
IIM Ahmedabad
Vastrapur, Gujarat – 380015
E Mail – sandeepk@iimahd.ernet.in
Phone: 079 26327816

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The paper is published in the book titled “ Human Resource Development: Challenges and Opportunities”
(Editor – Neelu Rohmetra)

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Introduction
The trend of globalization is providing opportunities for Indian firms to reach
foreign markets. The business model of many upcoming industries like the information
technology sector is dependent heavily on the foreign markets. This increases the need of
professionals working in foreign cultural settings. The merger and acquisition activity
especially the cross-border acquisitions have reached much higher levels. The trend of
acquisitions is not only restricted to the new sectors like Information Technology,
Telecom and Business Process Outsourcing, but core sector companies like
Manufacturing (For Example: Bharat Forge acquiring Carl Dan Peddinghaus in
Germany) and Mining (For Example: Sterlite group acquiring mines in Australia) have
observed spurt in such activities too. The sheer size of certain deals in the range of 200-
300 Million dollars (acquisition of Tetley, UK, Flag Telecom in Bermuda) indicates
global aspirations of the Indian firms. The Pharmaceutical companies have widened their
reach in world market with examples like Ranbaxy and DRL having presence in many
countries. The globalization dreams present a new challenge for the Indian firms; the
challenge to develop competent managers who would be able to work in new
environments efficiently and will act as a bridge between the parent company and its
subsidiaries. The globalization will also bring new employees to the Indian firms, the
ones with different origin, language and national culture adding complexities to the
culture of Indian organizations. The firms thus need to develop systems and processes not
only to train managers for expatriate assignments but also to handle cultural diversity.
This task can be achieved by well designed cross-cultural training programs which will
help employees in coping up with the stress and cultural shock while dealing with a new
culture. The need for cross-cultural training will be for both: Indian expatriates and
employees dealing with expatriates of other origins. The cross-cultural training will also
be required for the Indian companies getting into Business Process Outsourcing as the
clients belong to culturally different environments. Working effectively in cross-cultural
context is becoming vital competence for aspiring managers (Harris and Kumra, 2000).
The present article attempts to define the possible sources of cross-cultural differences,
its impact on business practices, competencies required for the expatriates, evolution of

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cross-cultural training, issues to be considered while developing cross-cultural training
and different ways of training the employees.
Determinants of cultural differences:
There have been many attempts to define cultures and what differentiates them. The
study by Hofstede (1981,in Hofstede, 2001) defined and differentiated between cultures
on various dimensions – viz. collectivism vs. individualism, power distance, uncertainty
avoidance, masculinity vs. feminism and long vs. short term orientation. The author
classified a number of countries on these parameters. These parameters can be defined as:
1. Power distance: degree of inequality in power between a less powerful individual
and a more powerful one in which they belong to same social system.
2. Masculinity vs. feminism: refers to the distribution of emotional roles between
the genders. It opposes a tough masculine to tender feminine society.
3. Uncertainty avoidance: is the extent to which a culture programs its members to
feel either comfortable or uncomfortable in unstructured situations.
4. Individualism vs. collectivism: is the degree to which individuals are supposed to
look after themselves or remain integrated into groups usually around the family
5. Long term vs. short-term orientation: refers to the extent to which a culture
programs its members to accept delayed gratification of their material, social and
emotional needs.
The differences in cultural values were shown by the study of Hofstede (2001), which
involves 60, plus countries where each one of them was classified on these
parameters.These cultural differences may effect motivational factors, collectivism at
work place, organizational structure design etc.Various studies have tried to study these
differences. The difference in cultures has been associated with perceptions and
paradoxes. The study by Osland and Bird (2000) lists down the paradoxes and the
reasons for them. The paradoxes arise because of perceptual schemas (cultural myopia
and lack of experience), theoretical limitations emic and etic studies which present one
sided views of the cultures (From inside and outside the culture while ignoring the other
ones.). The other reasons for misunderstandings are tendency for observers to confuse
individual and group values, unresolved cultural issues, role differences and real vs.
espoused values. The cultural differences and varying approaches lead to significant

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difference in business practices which must be recognized by the trainers and employees
receiving expatriate assignment.
How do people and practices differ across cultures :
The differences in cultures lead to significant differences in the way people react
to a stimulus. The motivational needs of the managers and executives vary across the
cultures. The motivational factors that work in India may not be relevant in China, hence
the expatriates will need to understand the basic differences in the employee behavior.
The production facilities of firms may be similar across all the subsidiaries but the
employee behavior in these facilities may not remain the same. One of the relevant
examples in this context is failure of Japanese management technique like Quality Circles
in India. The study by Neelankavil, Mathur and Zhang (1999) that analyzed India,
Philippines, USA and China for managerial performance and motivational factors in two
different studies found different managerial values, value dimensions and comparative
management. India was found closer to USA than China although the geographical
distance is much lesser. For example for American managers drive and ambition were
important for success which is not the case in China. These countries differ in their scores
of individualism with USA (91) and china (7) and the other two falling in between.
Similarly the study of motivational factors found opportunity for advancement and
financial rewards to be least important while these factors were nearly very important for
employees in the other countries. The study by Peters and Lipit (1978) found USA
employees different from those in Latin American countries like Columbia, Peru and
Chile,even within the Latin American countries there was a difference between Columbia
and Peru (good pay as the highest ranked motivator) and Chile (creativity as the highest
ranked motivator). The culture differences effect the managerial decisions related to
performance appraisals in multicultural workplaces and decisions in international
business context (Lee and Karakowsky, 2001).
Along with the business practices and values significant amount of research
have been conducted in the context of cross-cultural negotiations. The cross-cultural
differences in the negotiation game can be conceptualized along four basic dimensions:
collectivism-individualism, power distance, communication context, and the conception
of time (Cohen, 1997- as cited by Bazerman, Curhan, Moore and Valley, 2000). The

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time factor becomes important in the context of cross border acquisitions as people
belonging to different cultures have different perceptions related to time, while in some
cultures people prefer to start and finish meeting on time (Example: USA), in other
people may prefer to take time of their own (Example: Latin America)(Mayfield,
Mayfield, Martin, Herbig, 1997). The time factor also refers to relationship dynamics of
negotiations. While in a more collectivist culture, people may prefer to develop
relationships during negotiations, people in more individualistic culture like USA may
not prefer to bring relationship dimension in the negotiations (Mayfield, Mayfield,
Martin, Herbig, 1997). The study by Gulbrow and Herbig (1999), found that the
negotiators from more collectivist culture would devote more time to non-task
negotiating activities and positioning activities. Similarly the people from high power
distance cultures were found to spend less time compromising and less persuasion was
observed in people from more masculine culture. The analysis by George, Jones and
Gonzalez (1998) lists three categories of differences which can affect the negotiator
emotions, these include: individual differences (affective dispositions, experiences in
previous cross-cultural negotiations), cross-cultural differences (Internalized cultural
values and norms, Emotional expressions, Linguistic style) and contextual differences
(Relationship between the negotiating partners, level of trust and conditions surrounding
the negotiations). The norms and values related to the negotiations differ according to the
culture, for example the study by Weiss and Stripp (1985, as referred to by George, Jones
and Gonzalez, 1998) lists differences in the negotiations norms as: perceptions about
negotiation to be strategic or synergetic, criteria for selecting the negotiator, importance
given to relationship building, concern for protocol and formality etc. The way emotions
are expressed in the various cultures may differ, for example the face expressions and
hand gestures may convey different meanings in different culture. The study by Weber
and Hsee (1998), points towards significant differences in the risk perceptions across
cultures that might play an important role during business negotiations across coutries.
Impact of dealing with a different culture
The cultural change leads to cultural shock (McEnery and DesHarnais, 1990), which is a
mental state of stress caused by acute changes in the culture. The expatriates tend to feel
lonely because all of a sudden every thing changes including the work environment,

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peers, processes and to an extent organizational culture and value system. The employees
react by comparing the new culture to their own values and beliefs and at times are
unable to accept the vast difference between the two. The process of encountering and
accepting the new changes or in other words process of acculturation can be classified in
four stages (Nicola, 1993)
ƒ Initial stage of elation and optimism
ƒ Period of frustration, depression and confusion
ƒ Gradual improvement of mood leading to optimism and satisfaction
ƒ Mastery stage
Oberg (1960, cited by Caligiuri et.al. (2001)) described four stages of adjustment: Stage
I, the initial, or honeymoon stage; Stage II, the disillusionment, or culture shock stage;
Stage III, the adjustment, or adaptation stage; and Stage IV, the mastery stage. The
honeymoon stage is a period lasting less than two months. Here the employee is thrilled
with the new experience. The culture shock stage occurs as the individual copes seriously
with living in the new culture on a daily basis, as a lack of understanding of the culture
inhibits awareness of what is appropriate, or inappropriate, behavior in the new cultural
environment, resulting in confusion, frustration, tension and depression. The frustration
occurs as the person begins to realize that past behaviors are inappropriate in the host
culture but has not yet learned what behaviors to substitute. The adjustment stage is
characterized by increased ability to adapt in the new culture; and, in the mastery stage,
adjustment is about as complete as possible, and anxiety is largely gone. Rhinesmith
(1970), classified reactions to a different culture in three categories that are flight, fight
and adaptation. The flight here characterizes reactions like rejecting new culture and
people and withdrawing from any opportunity of interacting with new people or
situations that cause discomfort. The Fight is approaching new culture with hostility and
term adaptation is used for people who undertake the process of understanding the
difference and adjusting to the new culture.
Defining Expatriate Competencies:
The expatriates need to perform the same set of functions but in a completely different
environment which can cause lot of stress to the person. The cultural stress will have
significant impact on various aspects of the job related behavior. Most of the expatriate

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failures are related lack of adjustment in new culture. Hence while defining the
competencies for the expatriates human resource professionals also need to assess the soft
skills of employees which will be handy in the new environment like tolerance of cultural
difference, ability to adapt new culture and interpersonal relationships. The cross-cultural
skills required for successful expatriate assignment can be listed broadly as (Hofstede,
2001):
ƒ The capacity to communicate respect
ƒ The capacity to be non judgmental
ƒ The capacity to understand relativity of one’s own knowledge and perception
ƒ The capacity to display empathy
ƒ The capacity to be flexible
ƒ Tolerance for ambiguity
The focus is clearly on the soft skills and emotional maturity. The people undertaking
foreign assignments must be mature and stable enough to accept the existence of cultural
differences. They should also be able to understand the context of various situations and
happening, which calls for objective evaluation of a situation without bringing in one’s
own biases and perceptions. The cross-cultural competencies have can be viewed as
combination of three different dimensions (Black and Mendenhall, 1990) that are self-
maintenance dimension (mental health, psychological well-being, stress reduction and
self confidence), relationship dimension (ability to foster relationship with the people of
host nations and perceptual dimension (perceptions of host nation’s culture and its social
systems. Thus perceptions have been given an important role in defining competencies.
Most often employees tend to make perceptions based little information they receive
through the media or stories. This leads to general stereotyping causing formation of
wrong notions about the host culture. The employee should instead form opinions and
beliefs related to the host nation only after spending considerable amount of time over
there. The events which are used to form these perceptions should be seen in depth using
the back ground information like social value system, political system and cultural
values. Only then a clear picture of host nation culture will emerge. The employees on
expatriate assignments must be able to decode various verbal and non-verbal ways of
communication used in the new culture and work in unstructured and ambiguous

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situations (Demers, 2002). The expatriate employees should have capabilities to deal with
alienation and isolation, willingness to communicate and empathy for people of other
cultures (Mendenhall and Odou, 1986). The competencies required for expatriate
assignments have been classified under categories of stable and dynamic competencies in
the paper by Sullivan (1999). The author has broken the dimensions proposed by Black
and Mendenhall (1990) in stable and dynamic components. The components are listed in
the following table:

Type of competency Self Maintenance Relationship Perceptual

Stable Emotional stability Extraversion, Openness to
agreeableness experience,
Conscientiousness
Dynamic Cultural Conflict resolution Perceptual
Knowledge, Self skills, Conceptual questioning skills
maintenance and cultural knowledge
self-efficacy, stress
management skill
Hence the employees should have the ability to question the perceptions and resolve
conflicts arising out of the cultural differences. The stress management skills have been
given importance because the cultural differences and lack of proper socialization along
with cultural shock causes stress on the expatriates. The stress might also arise from
living at a distance from the family.
Defining Cross-cultural training and its objectives
The cross-cultural training in general can be defined as “Any intervention aimed at
increasing an individual’s capability to cope with and work in foreign environment”
(Tung, 1981, in Zakaria, 2000). Hence cross-cultural training involves all the methods
like lectures, simulation etc. used to make the person familiar with a different culture.
The term cross-cultural training hence is broad enough to include differences in areas like
language abilities, business etiquettes, beliefs and values, social system, negotiating
styles etc. of any culture. The cross-cultural has also been defined as “Formal methods to
prepare people for more effective interpersonal relations and job success when they

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interact extensively with individuals from cultures other than their own” (Brislin and
Yoshida, 1994). The term job success here seems to be slightly ambiguous, as the factors
defining success on an expatriate assignment can include organizational values, earning
respect from peers and subordinates, technical skills, interpersonal and relationship
management skills etc. The advantages from cross-cultural training have been listed as
following (Zakaria, 2000: 2):
1. A means for constant switching from an automatic, home culture international
management mode to a culturally adaptable and acceptable one
2. An aid to improve coping with unexpected events and cultural shock in a new
culture
3. A means to reduce uncertainty of interactions with foreign nationals
4. A means for enhancing expatriates coping abilities
Hence cross-cultural training can be seen as a tool for improving the corporate culture
and practices by constantly learning through induction of foreign nationals in the
organizations. Further the cross-cultural training will help to reduce the psychological
stress and cultural shock which often lead to failure of expatriates.

The process of expatriation - the cultural issues: A model for analysis

Foreign
Role of cross-cultural country
training. culture
Cultural shock,
coping
problems,
Employee beliefs confusion
Domestic and values, work
country culture, work
styles. Expatriate
culture

Coping with
Foreign change,
organizatio transition to
nal culture normalcy
Organizational
culture

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Design of cross-cultural training:
The issues or focus points are very important in the cross-cultural as it is required to
choose between culture specific or culture general training, which areas of the culture to
focus upon and what are the personal requirements of the person who might have to deal
with a situation like this or who is shifting to a different culture for work. The study by
Hun and Jenkins (1998) mentions following issues for the cross-cultural training:
ƒ Different aspects of time like punctuality- The time factor here involve two
dimensions that are punctuality and relationship dimension. While in some
cultures like USA starting and ending on time are very important in others like
South American countries that may be considered exceptional. Some cultures
prefer to take time for relationship building, which may not be acceptable at all in
others. Hence cross-cultural barriers related to time need to be taken care of.
ƒ Linguistic barriers- The English is being used for most transactions but then usage
of English tends to change with the country contexts. For example the
pronunciation in India is significantly different from the American way. Secondly
certain terms may have different meaning in different languages; hence context
also plays an important role. In case of countries with different language the
expatriates must be trained in opening dialogues and discussions with the help of
translators.
ƒ Different business practices, like conduct in meeting and unstructured and open
discussion. Hofstede’s (2001) dimensions like power distance can play an
important role in situations like conduct during the meetings. In cultures with
lower power distance the employees may tend to call their bosses with their first
names while this may be impossible in cultures with higher power distances.
Hence developing a first hand knowledge about the practices is very important.
ƒ Cultural stress (ambiguity and difference of perceptions)- The training should also
involve methods to counter stress and to interpret situations. The expatriates will
have to understand the situations on their own and then form perceptions. The
training should avoid any kind of stereotyping where trainees may be lead to
believe certain things about any culture. The culture may broadly explain value

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 system of a community or country but every individual is different. Hence any
individual with a pre-formed notion about the culture will be shocked to see
people different from his beliefs leading to lot of confusion and stress.
ƒ Body language and greetings- The way emotions are expressed in the various
cultures may differ, for example the face expressions and hand gestures may
convey different meanings in different culture.
The cross-cultural training should have components related to both general orientation
and specific skill development (Harrison, 1994). The component of general orientation
here consists of self assessment (dealing with change, stress management and identifying
attributes) and cultural awareness (general dimensions, national values and work place
incidents). The specific development on the other hand consists of knowledge acquisition
(area studies, language studies and host attitudes) and skills training (case studies, area
simulation and behavior modeling). Hence the training should focus on providing trainee
the knowledge about national cultures and attitudes in the host country in the first phase
while in second phase the trainee should be made to go through a rigorous process of
handling the situations in a simulated environment. This will help the trainee to acquire
hands-on experience. The paper by Nicola (1993) suggests following issues for cross-
cultural training:
ƒ Feed back
ƒ Getting beyond culturally determined stereotypes
ƒ How to raise and deal with cultural stereotype
ƒ How to counsel employees
ƒ Coaching and team building
ƒ Resolving conflicts (those including various ethnic groups at work place)
ƒ Counseling so as to go beyond all kinds of stereotypes and perceptions.
After the internet revolution things have vastly changed for various organizations. For
example many firms use internet as a medium to coordinate between different employees
working in different locations as a team like one of the team members would be in India,
other one might be in Europe and third one in North America. The group dynamics in
these situations becomes very important; hence the employees must also be trained at
handling people from diverse cultures at the same time ensuring equal treatment and

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opportunities for all. One of the most important factors that is often forgotten while
designing the training programs is the requirement of the employees, the design of
training program should be made keeping in mind the length of stay in the host country,
type of function he will have to perform, degree of socialization required by the
employee and the personal characteristics of the employees (extraversion, interpersonal
skills etc.). Hence cross-cultural training program should be customized for each
employee to certain extend. It’s not only the employee who needs to be trained; the
family of employee should also be trained on certain issues like cultural differences.
Many firms have started giving due importance to the training of spouse because the
socialization of expatriate and job success to a large extent will depend upon socialization
of his family.
The training methods :
The cross-cultural training evolved with usage of lecture method (originated from
university of Illinois- as referred by Bhawuk and Brislin, 2000). This development was
followed by usage of contrast American method which was named as this method was
used to train for contrasting cultural experiences. The scenarios and cultural assimilators
were later additions to the methods. The self reference criterion method was developed
from cultural analysis system developed in 1966. The first usage of the cultural
assimilators was on the American soldiers in 1972. The existence of cultural general
assimilator is relatively new with usage starting in 1986. The experiential and area
simulation were developed in 70’s.
The various cross-cultural training methods can be explained as follows (as described by
Bhawuk and Brislin, 2000):
ƒ Cultural assimilator: The cultural assimilator is a tool that consists of a number of
real life scenarios describing puzzling cross-cultural interactions and expectations.
The scenarios here can be defined as critical incidents which describe interactions
between host and expatriates which involve misunderstanding related to cultural
differences.
ƒ Contrast American method: This method involves demonstration of behaviors
that are completely opposed to what is seen in the current context of culture. This

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 was used by Stewart in America to train people going abroad hence was named
contrast American.
ƒ Self reference criterion (SRC): Unconscious reference to one’s own cultural
values in communication with people who are from other cultures. This method
was developed by Lee (1966), who proposed 4 step procedure to overcome self
reference criteria. The first step involves defining any problem of situation in
terms of the expatriate’s own culture, followed by definition in the terms of host
culture. The bias created by SRC is analyzed and removed in third stage which is
followed by solution of the simplified business problem.
ƒ Area simulation: The simulation is creating natural situation of interaction with
people from other culture. This can be achieved using some actors who will
interact with the trainee according to some predefined script.
ƒ Cultural self awareness model: The cultural awareness model includes usage of
video tapes with themes and role plays. If the trainee is able to understand how his
culture is different he would be able to accept the differences encountered in the
real life interactions in a better manner.
The study by Caligiuri et. al.,2001 refers to the study by Brislin et al(1983) outlined the
frequently used cross-cultural training methodologies during early 90’s: “(1) fact-oriented
training; (2) attribution training, associated with the culture assimilator to enable trainees
to internalize values and standards of the host culture; (3) cultural awareness training, the
study of the trainee’s home culture and its effect on his/her behavior to enable the trainee
to understand the nature of cultural differences; (4) cognitive-behavior modification, to
assist trainees to be able to obtain rewards and avoid punishment in the host culture; (5)
experiential learning, active participation learning about a specific host culture; and (6)
interaction learning, for trainees to feel more comfortable with host nationals and to learn
details about life in the host country. Language training aids in communications
demonstrate an attitude of attempting to learn about the host culture enables one to be
polite and permits understanding”.
The impact of cross-cultural training on the employee performance
Many research studies have focused on the impact of cross-cultural training on variables
like adjustment and performance of the employees. The Meta analysis by Morris and

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Robie (2001) found the correlation of cross-cultural studies to be 0.26 for performance
and 0.13 for adjustment. This has been totally opposite to the results of the earlier studies
like the one by Deshpande and Vishwesveran (1992, in Morris and Robie) found the
correlation with performance to be .39 and 0.43 with adjustment. The study by Morris
and Robie(2001) examined 16 studies for expatriate adjustment and 25 studies for
performance. The authors also cites the results of studies by Black (1988) and Earley
(1987) who found the correlation to be 0.42 and 0.57 for adjustment. The correlation
with performance in the same studies was 0.08 and 0.79. Hence there is lack of
consistency in the results.
The study of Gullahorn and Gullahorn (1966, cited by Caligiuri et. al. 2001) “found that
cross-cultural adjustment process leads to a U-shaped curve of adjustment where the
bottom of the curve is the strongest point of culture shock. This U-Curve Theory of
Adjustment (UCT) has been one of the most consistently used theories, a rare case of
theoretical perspective applied to cross-cultural research, although no in-depth and
comprehensive reviews of the empirical literature related to UCT exist”. Grove and
Torbiorn (1985 cited by Caligiuri et al, 2001) proposed that cross-cultural, or
intercultural, training should attempt to bring about changes in three psychological
constructs, ‘applicability of behavior, clarity of mental frame of preference, and level of
mere adequacy’. The study by Worchel and Mitche (1972, cited by Bhawuk and Brislin,
1992) found use of cultural assimilator to be effective on the American soldiers( in
Greece) in enhancing there productivity, adjustment, enjoyment of tour of duty and
interpersonal behavior. The literature review by Zakaria (2000) found substantial positive
relationship between cross-cultural training and adjustment. He cites works of Bochnar
(1982) and Backer (1984) who found cross-cultural training to be useful for cross-cultural
interaction. The paper by Caligiuri et.al. (2001) suggests development of training
programs that will ensure that expatriates have realistic expectations. The study by
Brewster and Pickard (1994) found that cultural training was more effective for younger
people and people with no prior experience. Some studies like study of American
expatriates in Mexico (Edmund, 2002) did not find a significant relationship between
cross-cultural training and expatriate failure rate. Similarly the study by Selmer (2001) of
didn’t find relationship between the pre-knowledge about culture and practices of Hong

14
Kong and their ability to get along with their host country subordinates. In contrast the
study by Eschbach, Parker and Stoeberl (2001) found cross-cultural training effective in
reducing time required to adjust and achieve cultural proficiency. Hence the studies
broadly support the effectiveness of cross-cultural training in improving the expatriate
efficiency.
Conclusion
It is imperative that employees who are to be expatriated are well informed regarding the
challenges they might face in a foreign land. Coping with a foreign culture both
organizational and national needs well-planned preparation. A well structured cross-
cultural training will help the employees to prepare for coping with the changes in the
working styles, beliefs and values they are expected to face. A large degree of uncertainty
which an employee might face while moving to a foreign land and culture can be reduced
through organizational support in terms of training. The huge costs that an organization
might face due to expatriate failure is of high concern. Preparing the employees for a
foreign assignment is mutually beneficial to the organization and the employee. For the
employees, a well delivered training can help in managing with the new situations, while
for the organization this helps in getting the best of the employee in terms of work output
through maintaining the employee morale and motivation. With the growing influence of
foreign markets and increasing growth prospects for multinational business models, it is
of high importance that companies prepare their employees to be fit for global
assignments.

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